Amazon's Q2 Earnings Showcase AI Investment Impact Amid Strong Financial Performance

Amazon Retail Solid, But Dragged by AWS Amid Strong Peers

Amazon.com Inc. projected operating income in the current quarter that fell short of analysts' estimates, worrying investors that the tech giant is spending too much to keep up with competitors in the race for artificial intelligence. Operating profit will be $15.5 billion to $20.5 billion in the period ending in September, compared with an average estimate of $19.4 billion. Sales will be $174 billion to $179.5 billion, the company said Thursday in a statement. Analysts, on average, expected $173.2 billion. Chief Executive Officer Andy Jassy is engaged in an AI infrastructure arms race with Microsoft Corp. and Alphabet Inc. that requires heavy spending on data centers. Both of those rivals reported strong earnings earlier this week showing they are benefiting from the AI boom. Anurag Rana and Poonam Goyal join Bloomberg Businesswek Daily to discuss. (Source: Bloomberg)

Amazon Reports $18.2 Billion in Profit Amid Strong Retail Demand

Despite uncertainty over President Trump's trade war, Amazon on Thursday reported surprising resilience among the consumers who drive its retail business. But profit margins tightened at the cloud computing services that the e-commerce giant offers corporate customers. Overall, sales from April through June rose to $$167.7 billion, 13 percent more than the same period a year earlier. Profit was $18.2 billion, up 35 percent. For the current quarter, which ends in September, Amazon told investors to expect sales of $174 billion to $179.5 billion, and operating profits between $15.5 and $20.5 billion. The guidance showed confidence that customers will keep spending, but reflected a broad range of how much it will cost to serve them. "Our conviction that A.I. will change every customer experience is starting to play out," Andy Jassy, Amazon's chief executive, said in a statement. Amazon, along with its peers in Big Tech, has been on a frantic spree to develop data centers, massive remote buildings packed with servers that power cloud computing and artificial intelligence. In May, Mr. Jassy told investors that Amazon could have sold more cloud services if it had more data centers, which the company was building more rapidly. On Thursday, Amazon reported that it spent more than $31 billion on capital expenses in the last quarter, about twice as much as a year earlier. Amazon's cloud services posted $30.9 billion in sales, up 17.5 percent. But the division reported lower profit margins than in recent quarters, producing $10.2 billion in operating income. It accounted for just over half of the company's operating profit. In its e-commerce and retail business, the number of items sold grew 12 percent, a sign that consumers did not slow their spending despite tariffs and a less certain economy. Online sales of products by Amazon directly to customers grew 11 percent, to $61.5 billion. The sales of services to sellers on Amazon's marketplace, such as listing and fulfillment, grew 11 percent to $40.3 billion. In Amazon's physical stores, such as Whole Foods and Amazon Fresh, sales grew 7 percent to $5.6 billion. Operating profit in its North America retail business grew 48 percent, to $7.5 billion. Some of that comes from growth one of its most profitable businesses: selling advertising. Ad sales grew 23 percent to $15.7 billion. Amazon has also worked to make its operations more efficient by redesigning how it moves and stores products across its more than 1,000 U.S. warehouses. By bringing the right products closer to customers, Amazon can make them less costly and quicker to deliver, which in turn boosts sales. It has also kept costs down by not hiring as much, even as its business has grown. The company had 1.546 million employees, up just 1 percent from a year earlier.

Amazon tops Q2 estimates with $167.7B in revenue, $18.2B in profits; AWS up 17% to $30.9B

Amazon beat estimates for its second-quarter earnings with $167.7 billion in revenue, up 13% year-over-year, and earnings per share of $1.68, up from $1.26 in the year-ago period. Net income was $18.2 billion, up from $13.5 billion last year. Wall Street expected $162.1 billion in revenue, and earnings per share of $1.33. Despite topping expectations, Amazon shares were down more than 3% in after-hours trading. The results provide a snapshot of Amazon's business as the company invests heavily in its cloud computing business to fuel AI-related efforts and navigates economic headwinds within its retail division. Amazon Web Services reported $30.9 billion in revenue for Q2, up 17.5% year-over-year -- in line with analyst estimates. * The company makes most of its operating profits from AWS -- about $10.2 billion in the second quarter, more than half Amazon's total operating income of $19.2 billion. * Google and Microsoft also reported strong results for their respective cloud units this month. * Amazon said earlier this year it expects to increase capital expenditures to more than $100 billion in 2025, up from $83 billion in 2024, with a majority going toward building out capacity for AI in AWS. Online store sales totaled $61.5 billion, up 11%. * Analysts were watching for impact from tariffs on the company's retail business, which still makes up the largest portion of its overall revenue. * In its Q1 earnings report in April, Amazon added "tariff and trade policies" to a list of factors that create uncertainty in its results, joining existing risks such as inflation, interest rates, and regional labor market constraints. * The company's annual Prime Day sales event took place after the quarter ended, from July 8-11, so the results aren't included in these earnings numbers. Here's more details from the second quarter earnings report: Advertising: The company's ad business brought in $15.6 billion in revenue in the quarter, up 23% from the year-ago period. Third-party seller services: Revenue from third-party seller services was up 11% to $40.3 billion. Shipping costs: Amazon spent $23.3 billion on shipping in Q2, up 6%. Physical stores: The category, which includes Whole Foods and other Amazon grocery stores, posted revenue of $5.6 billion, up 7%. Headcount: Amazon employs 1.54 million people, up 1% year-over-year. That figure does not include seasonal and contract workers. * Amazon's corporate workforce will shrink in the coming years as generative AI takes hold, Jassy told employees in a company-wide memo last month. Prime: Subscription services revenue, which includes Prime memberships, came in at $12.2 billion, up 12%. Guidance: The company forecasts Q3 sales of $174 to $179.5 billion -- above analyst estimates of $173.2 billion. Operating income is expected to range between $15.5 billion and $20.5 billion.

Amazon earnings beat across the board, but shares fall as investors fret about trade headwinds

For the April-June period, Amazon posted revenue of $167.7 billion, climbing 13% year-over-year and outpacing analyst predictions of $162.1 billion. Earnings per share came in at $1.68, also topping the expected $1.33. Net income for the quarter reached an impressive $18.2 billion, more than a 10% increase from last year. Amazon's financial outperformance stems from strong execution across several areas. Though its sprawling retail operations remain the largest part of its business, the real engine of profit growth continues to be Amazon Web Services (AWS), the company's cloud-computing arm. AWS generated $30.9 billion in revenue, marking a 17.5% increase year-over-year and landing squarely in line with industry forecasts. The unit contributed $10.2 billion in operating profit -- more than half of Amazon's total $19.2 billion operating income for the quarter. This confirms AWS's role as Amazon's financial powerhouse, driven by surging demand for AI and cloud infrastructure as businesses accelerate technology investments. Chief executive Andy Jassy has spotlighted AI as a transformative force for Amazon, with the majority of 2025's planned $100 billion in capital expenditures dedicated to expanding AWS' capacity for generative AI and machine learning. As major clients move more workloads to the cloud and adopt AI-driven services, AWS remains positioned for long-term leadership, despite short-term margin pressures from its heavy investments. Despite ongoing concerns about tariffs and consumer spending, Amazon's core online store sales grew 11% to $61.5 billion. The company's third-party seller services also expanded, with revenue rising 11% to $40.3 billion. Physical stores, including Whole Foods, delivered a 7% increase to $5.6 billion, while subscription revenue -- such as Prime memberships -- rose 12% to $12.2 billion. Amazon's advertising segment was a standout performer, raking in $15.6 billion in revenue, up 23% from the prior year. This ad business is becoming an increasingly critical pillar within Amazon's profit structure, as brands compete for consumer eyeballs on the platform's massive shopping interface. The company is navigating a complex macroeconomic climate that includes inflation, changing trade policies, and labor market constraints. Shipping expenses climbed 6% to $23.4 billion, reflecting both global cost pressures and heightened demand for fast delivery. Although Amazon's Q2 earnings don't reflect the impact of July's Prime Day -- held after quarter's end -- the company remains optimistic, projecting third-quarter revenue in the range of $174 billion to $179.5 billion, above analyst expectations. Operating income is forecast between $15.5 billion and $20.5 billion. Meanwhile, Amazon's headcount inched up 1% year-over-year to 1.55 million, with CEO Andy Jassy signaling further workforce streamlining as automation and generative AI gain traction internally. "Our AI progress across the board continues to improve our customer experiences, speed of innovation, operational efficiency, and business growth, and I'm excited for what lies ahead," he said in the earnings press release. Despite the upbeat earnings report, Amazon stock fell in extended trading, illustrating Wall Street's wariness about continued retail volatility, capital-intensive growth, and competitive dynamics in cloud and AI. Still, analysts remain bullish on Amazon's strategic direction, citing leadership in cloud innovation, resilient retail fundamentals, and an aggressive expansion into the future of artificial intelligence.

Amazon profits surge 35% but forecast sinks share price

Amazon reported a 35% jump in quarterly profits Thursday as the e-commerce giant said major investments in artificial intelligence began paying off. But the Seattle-based company's profit outlook for the current quarter came in lower than hoped for, with investors worried that the cost of AI was weighing on the bottom line. Amazon's share price was trading about six percent lower in after hours trading. This was despite a stellar second quarter that exceeded analyst expectations, much like it did for its AI focused rivals Google, Microsoft and Meta, which posted bumper results for the period. "Our conviction that AI will change every customer experience is starting to play out," said Chief Executive Andy Jassy, pointing to the company's expanded Alexa+ service and new AI shopping agents. Amazon posted net profit of $18.2 billion for the second quarter that ended June 30, compared with $13.5 billion in the same period last year. Net sales climbed 13% to $167.7 billion, beating analyst expectations and signaling that the company was surviving the impacts of the high-tariff trade policy under US President Donald Trump. "There continues to be a lot of noise about the impact that tariffs will have on retail prices and consumption. Much of it thus far has been wrong and misreported," Jassy told analysts. 'Curveballs' Amazon Web Services (AWS), the company's world leading cloud computing division, led the charge with sales jumping 17.5% to $30.9 billion. The unit's operating profit rose to $10.2 billion from $9.3 billion a year earlier. The strong AWS performance reflects surging demand for cloud infrastructure to power AI applications, a trend that has benefited major cloud providers as companies race to adopt generative AI technologies. But investors seemed worried about Amazon's big cash outlays to pursue its AI ambitions, sending its share price more than three percent lower in after-hours trading. The company's free cash flow declined sharply to $18.2 billion, down from $53 billion in the same period last year, as Amazon ramped up capital spending on AI infrastructure and logistics. The company spent $32.2 billion on property and equipment in the quarter, nearly double the $17.6 billion spent a year earlier, reflecting massive investments in data centers and backroom capabilities. Amazon has pledged to spend up to $100 billion this year, largely on AI-related investments for AWS. For the current quarter, Amazon forecast net sales between $174.0 billion and $179.5 billion, representing solid growth of 10-13% compared with the third quarter of 2024. But operating profit was forecast in a wide range from $15.5 billion to $20.5 billion in the current third quarter, which was more cautious than some had hoped for. The caution indicates that "there's still potential for curveballs from ongoing trade negotiations and accelerating competition on the AI front," said Emarketer analyst Sky Canaves.

Amazon profits surge 35% but forecast sinks share price

San Francisco (United States) (AFP) - Amazon reported a 35 percent jump in quarterly profits Thursday as the e-commerce giant said major investments in artificial intelligence began paying off. But the Seattle-based company's profit outlook for the current quarter came in lower than hoped for, with investors worried that the cost of AI was weiging on the bottom line. Amazon's share price was trading about six percent lower in after hours trading. This was despite a stellar second quarter that exceeded analyst expecations, much like it did for its AI focused rivals Google, Microsoft and Meta, which posted bumper results for the period. "Our conviction that AI will change every customer experience is starting to play out," said Chief Executive Andy Jassy, pointing to the company's expanded Alexa+ service and new AI shopping agents. Amazon posted net profit of $18.2 billion for the second quarter that ended June 30, compared with $13.5 billion in the same period last year. Net sales climbed 13 percent to $167.7 billion, beating analyst expectations and signaling that the company was surviving the impacts of the high-tariff trade policy under US President Donald Trump. "There continues to be a lot of noise about the impact that tariffs will have on retail prices and consumption. Much of it thus far has been wrong and misreported," Jassy told analysts. 'Curveballs' Amazon Web Services (AWS), the company's world leading cloud computing division, led the charge with sales jumping 17.5 percent to $30.9 billion. The unit's operating profit rose to $10.2 billion from $9.3 billion a year earlier. The strong AWS performance reflects surging demand for cloud infrastructure to power AI applications, a trend that has benefited major cloud providers as companies race to adopt generative AI technologies. But investors seemed worried about Amazon's big cash outlays to pursue its AI ambitions, sending its share price more than three percent lower in after-hours trading. The company's free cash flow declined sharply to $18.2 billion, down from $53 billion in the same period last year, as Amazon ramped up capital spending on AI infrastructure and logistics. The company spent $32.2 billion on property and equipment in the quarter, nearly double the $17.6 billion spent a year earlier, reflecting massive investments in data centers and backroom capabilities. Amazon has pledged to spend up to $100 billion this year, largely on AI-related investments for AWS. For the current quarter, Amazon forecast net sales between $174.0 billion and $179.5 billion, representing solid growth of 10-13 percent compared with the third quarter of 2024. But operating profit was forecast in a wide range from $15.5 billion to $20.5 billion in the current third quarter, which was more cautious than some had hoped for. The caution indicates that "there's still potential for curveballs from ongoing trade negotiations and accelerating competition on the AI front," said Emarketer analyst Sky Canaves.

Amazon profits surge 35% as AI investments drive growth

San Francisco (United States) (AFP) - Amazon reported a 35 percent jump in quarterly profits Thursday as the e-commerce giant said major investments in artificial intelligence began paying off. The Seattle-based company posted net profit of $18.2 billion for the second quarter that ended June 30, compared with $13.5 billion in the same period last year. Net sales climbed 13 percent to $167.7 billion, beating analyst expectations and signaling that the global company was surviving the impacts of the high-tariff trade policy under US President Donald Trump. "Our conviction that AI will change every customer experience is starting to play out," said Chief Executive Andy Jassy, pointing to the company's expanded Alexa+ service and new AI shopping agents. Amazon Web Services (AWS), the company's world leading cloud computing division, led the charge with sales jumping 17.5 percent to $30.9 billion. The unit's operating profit rose to $10.2 billion from $9.3 billion a year earlier. The strong AWS performance reflects surging demand for cloud infrastructure to power AI applications, a trend that has benefited major cloud providers as companies race to adopt generative AI technologies. Despite the stellar results, investors seemed worried about Amazon's big cash outlays to pursue its AI ambitions, sending its share price more than three percent lower in after-hours trading. The company's free cash flow declined sharply to $18.2 billion for the trailing 12 months, down from $53 billion in the same period last year, as Amazon ramped up capital spending on AI infrastructure and logistics. The company spent $32.2 billion on property and equipment in the quarter, nearly double the $17.6 billion spent a year earlier, reflecting massive investments in data centers and backroom capabilities. Amazon has pledged to spend up to $100 billion this year, largely on AI-related investments for AWS. For the current quarter, Amazon forecast net sales between $174.0 billion and $179.5 billion, representing solid growth of 10-13 percent compared with the third quarter of 2024. Operating profit was expected to range from $15.5 billion to $20.5 billion in the current third quarter, which was lower than some had hoped for and likely also a factor in investor disappointment.

Amazon projects profit that underwhelms on expense of AI race

Gift 5 articles to anyone you choose each month when you subscribe. Amazon projected operating income in the current quarter that fell short of analysts' estimates, worrying investors that the tech giant is spending too much to keep up with competitors in the race for artificial intelligence. Operating profit will be $US15.5 billion ($24.1 billion) to $US20.5 billion in the period ending in September, compared with an average estimate of $US19.4 billion. Sales will be $US174 billion to $US179.5 billion, the company said in a statement. Analysts, on average, expected $US173.2 billion.

Amazon reports solid 2Q results and offers better-than-expected sales view

NEW YORK -- Amazon posted higher fiscal second-quarter profit and sales than the year-ago period, underscoring the online giant's resilience despite tariff uncertainty. The Seattle-based company also offered on Thursday a sales outlook for the current quarter that beat analysts' projections. Still, its shares fell nearly 7% in after-market trading as the company's estimates for operating income for the current quarter were below analysts' views. The company reported 17.5% growth for its prominent cloud computing arm Amazon Web Services. The results come even as uncertainty about President Donald Trump's tariffs have challenged companies and consumers. But Amazon and other large retailers have tried to beat the clock by bringing in foreign goods before Trump's tariffs took effect. Amazon, like many other big retailers, also has the clout to negotiate prices with its suppliers and a broad breadth of items. Amazon's CEO Andy Jassy told investors that while there's lots of noise about the impact of tariffs on retail prices and consumption, he said "it's impossible to know what will happen." That's because, in part, no one knows where tariffs will finally settle, especially in China, he said. "If costs end up being higher, we will absorb them, but what we can share is what we've seen thus far, through the first half of the year, we haven't yet seen diminishing demand nor prices meaningfully appreciating," he said. Jassy also touted the diversity of its more than 2 million sellers in its third-party marketplace, all with different strategies of whether to pass on higher costs to shoppers. Meanwhile, Amazon is one of the biggest players in the race around generative artificial intelligence. Like other tech companies, it has increased investments in the technology and is spending billions to expand data centers that power AI and cloud computing. The company is also investing in its own computer chips and those developed by Nvidia. It has also expanded its own AI models and integrated generative AI into other parts of its business. In March Amazon began testing AI-aided dubbing for select movies and shows offered on its Prime streaming service. A month earlier, the company rolled out a generative-AI infused Alexa. Jassy anticipates generative AI will also allow Amazon to reduce its corporate workforce in the next few years. The company is also making big investments in expanding its delivery network to bring faster delivery to customers in less densely populated areas across the U.S. Jassy told investors Thursday that the service is available in 1,000 of the more than 4,000 smaller cities, towns and rural communities targeted by year-end. He noted the early response has been "positive," with customers shopping more frequently and purchasing household essentials. Amazon earned $18.16 billion, or $1.68 per share, for the quarter ended June 30. That's up from $13.49 billion, or $1.26 per share, in the year-ago period. Revenue rose to $167.7 billion from $147.9 billion a year ago. The company's sales figure excluded the impact from Amazon's Prime Day event, which ran from July 8 to July 11. For the first time, Amazon held Prime Day over four days instead of two. Analysts expected earnings per share of $1.33 on sales of $162.19 billion for the quarter, according to FactSet. The company said it expects sales for the current quarter of between $174 billion and $179.5 billion. Analysts expected $173.27 billion for the current quarter, according to FactSet. However, Amazon said that operating income is expected to be between $15.5 billion and $20.5 billion for the third quarter, compared with $17.4 billion in the third quarter of 2024. Analysts expected $19.5 billion for the current quarter, according to FactSet.

Amazon's Earnings Top Expectations as Online Sales, AWS Deliver Strong Growth

Amazon (AMZN) reported second-quarter earnings that topped analysts' expectations, with better-than-expected growth in its Amazon Web Services as AI demand booms. The e-commerce and cloud services giant delivered quarterly revenue of $167.7 billion, up 13% year-over-year and above the analyst consensus from Visible Alpha. Net income of $18.2 billion, or $1.68 per share, compared to $13.5 billion, or $1.26 per share, a year earlier, topping Wall Street's estimates. Online store sales grew 11% to $61.49 billion, beating estimates, and revenue from Amazon Web Services revenue increased 18% to $30.9 billion, also above Street projections. "Our conviction that AI will change every customer experience is starting to play out," CEO Andy Jassy said. "Our AI progress across the board continues to improve our customer experiences, speed of innovation, operational efficiency, and business growth, and I'm excited for what lies ahead," he added. Looking ahead, Amazon forecast third-quarter revenue of $174 billion to $179.5 billion. Analysts had called for $173.17 billion. Shares of Amazon declined about 3% in after-hours trading. The stock was up 7% for 2025 through Thursday's close.

Amazon Q2 Earnings Highlights: Double Beat, 'AI Progress Across The Board Continues' - Amazon.com (NASDAQ:AMZN)

Ecommerce giant Amazon.com Inc AMZN reported second-quarter financial results after market close Thursday. Here are the highlights. What Happened: Amazon reported second-quarter net sales of $167.7 billion, up 13% year-over-year. The net sales total beat a Street consensus estimate of $161.9 billion according to data from Benzinga Pro. Sales were broken down as follows: North America: $100.1 billion, +11% year-over-year International: $36.8 billion, +16% year-over-year AWS: $30.9 billion, +17.5% year-over-year The company reported quarterly earnings per share of $1.68, beating a Street estimate of $1.30. Operating income for the company was $19.2 billion, which was broken down by segment: North America: $7.5 billion International: $1.5 billion AWS: $10.2 billion The company said it had its biggest Prime Day event ever in the quarter, with independent sellers seeing record sales. Amazon highlighted its DeepFleet AI model that helps Amazon's robots work smarter and improve efficiency. In the entertainment sector, Amazon highlighted its NBA broadcast team for upcoming coverage of basketball and the fact that its NASCAR races are averaging two million viewers per race and the youngest audience among NASCAR broadcasts in over a decade. "Our conviction that AI will change every customer experience is starting to play out as we've expanded Alexa+ to millions of customers, continue to see our shopping agent used by many millions of customers, launched AI models like DeepFleet," Amazon CEO Andy Jassy said. "Our AI progress across the board continues to improve our customer experiences, speed of innovation, operational efficiency, and business growth, and I'm excited for what lies ahead." Read Also: Magnificent Seven Now Worth Over $19 Trillion -- And They Make Up 35% Of The S&P 500 What's Next: The company expects third quarter net sales to come in a range between $174.0 billion and $179.5 billion, versus a Street estimate of $172.8 billion, according to data from Benzinga Pro. This range represents year-over-year growth of 10% to 13%. The company expects operating income for the third quarter to be in a range of $15.5 billion to $20.5 billion, compared to $17.4 billion in the third quarter of 2024. AMZN Price Action: Amazon stock is down 2.4% to $228.55 in after-hours trading Thursday versus a 52-week trading range of $151.61 to $242.52. Read Next: Amazon Denies Raising Prices Due To Trump & Tariffs: 'Consistently Offering Customers Low Prices Every Day' Photo: Shutterstock AMZNAmazon.com Inc$228.00-0.95%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentum67.02Growth97.35Quality65.28Value49.14Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

Amazon profits surge 35 per cent as AI investments drive growth

Amazon reported a 35 per cent jump in quarterly profits Thursday as the e-commerce giant said major investments in artificial intelligence began paying off. The Seattle-based company posted net profit of US$18.2 billion for the second quarter that ended June 30, compared with US$13.5 billion in the same period last year. Net sales climbed 13 per cent to US$167.7 billion, beating analyst expectations and signaling that the global company was surviving the impacts of the high-tariff trade policy under U.S. President Donald Trump. "Our conviction that AI will change every customer experience is starting to play out," said Chief Executive Andy Jassy, pointing to the company's expanded Alexa+ service and new AI shopping agents. Amazon Web Services (AWS), the company's world leading cloud computing division, led the charge with sales jumping 17.5 per cent to USS$30.9 billion. The unit's operating profit rose to US$10.2 billion from US$9.3 billion a year earlier. The strong AWS performance reflects surging demand for cloud infrastructure to power AI applications, a trend that has benefited major cloud providers as companies race to adopt generative AI technologies. Despite the stellar results, investors seemed worried about Amazon's big cash outlays to pursue its AI ambitions, sending its share price more than three per cent lower in after-hours trading. The company's free cash flow declined sharply to US$18.2 billion for the trailing 12 months, down from US$53 billion in the same period last year, as Amazon ramped up capital spending on AI infrastructure and logistics. The company spent US$32.2 billion on property and equipment in the quarter, nearly double the US$17.6 billion spent a year earlier, reflecting massive investments in data centers and backroom capabilities. Amazon has pledged to spend up to US$100 billion this year, largely on AI-related investments for AWS. For the current quarter, Amazon forecast net sales between US$174.0 billion and US$179.5 billion, representing solid growth of 10-13 per cent compared with the third quarter of 2024. Operating profit was expected to range from US$15.5 billion to US$20.5 billion in the current third quarter, which was lower than some had hoped for and likely also a factor in investor disappointment.